Key takeaways:

• The SEC has adopted the first of a series of final rules addressing the cross-border application of the security-based swap regulatory framework under the Dodd-Frank Act.
• The final rules focus on the application of the security-based swap dealer and major security-based swap participant registration thresholds to cross-border security-based swap transactions, by addressing which transactions must be counted towards the registration thresholds and by providing a definition of U.S. person for these purposes.
• The SEC's final rules are generally similar to the CFTC's cross-border guidance, but there are certain differences that may subject market participants that enter into both swaps and security-based swaps to conflicting requirements for each type of transaction.
• While this cross-border guidance will become effective 60 days after its publication in the Federal Register, actual requirements on market participants will only take effect after the adoption of the underlying substantive rules.
• The final rules also include a procedural rule regarding the submission of “substituted compliance” requests to the SEC to allow market participants to satisfy certain Title VII obligations by complying with comparable foreign regulatory requirements.